Mercedes adds plug-in hybrids at AMG Unit


FRANKFURT — Mercedes-Benz is considering adding more plug-in hybrids to its AMG performance-car lineup, as the automaker seeks to balance consumer demand for roaring combustion power with government pressure to meet stricter emissions rules.

Fleet customers of the brand have responded well to a growing list of plug-in hybrid models for sale, ranging from compacts to full-size vehicles, Mercedes sales chief Britta Seeger said in an interview.  

Private consumers are also increasingly willing to consider alternatives to traditional gasoline or diesel engines, she said.

“Over the past 12 to 18 months we’ve really seen a mindset change and people are becoming much more open toward electric and hybrid cars,” Seeger said. “I see a lot of potential for AMG to grow further, both with traditional performance models as well as electrified versions like the upcoming GT 4-Door Coupe hybrid,” she said.

Traditional automakers have been forced to rethink the market as they confront new emissions rules, rapidly changing technology and potent competition from rivals such as Tesla and new tech-industry entrants.

The future is particularly uncertain for performance brands like AMG that rely on the growl of a big engine to attract wealthy customers.

With consumer demand for full-electric cars still unproven, plug-in hybrids may offer an attractive way for AMG to adapt without alienating range-anxious drivers unwilling to move away from combustion engines altogether.

The GT 4-Door Coupe, a plug-in hybrid first shown as a concept in 2017, is due out this year. It pairs a gasoline-powered V-8 engine with a hybrid drive unit derived from the Formula One racing program — an approach that delivers more than 800 hp, underscoring AMG’s high-performance roots.  

AMG also is developing a two-seat supercar called the Project One, and is considering a plug-in hybrid version of the AMG 63 coupe and other models.

Turbulent times

Mercedes faced a turbulent 2019 that saw record global deliveries while profit margins were squeezed, and regulatory costs rose.

In its latest profit warning, parent Daimler said Wednesday that legal expenses related to diesel cheating allegations also hurt last year’s results.

Still, there was good news as Mercedes outsold rival BMW for another year to keep the luxury crown.  

Demand for upscale cars proved more resilient than the general market — a trend Seeger expects to continue — even as tariffs, Brexit and geopolitical tensions keep automakers on high alert.

“It’s becoming increasingly difficult to make concrete forecasts,” Seeger said. “I remain optimistic because demand for individual mobility and wealth creation in major markets continues to grow.”

Like other European automakers facing tighter emissions rules, Daimler has pressed forward with plans to introduce a range of full-electric cars.  

Last year it rolled out the EQC SUV, a competitor to Tesla’s Model X. The fully electric EQS concept shown in September, a sibling of the flagship S-class sedan, will serve as a basis for more purely battery-powered luxury cars as Daimler aims to offer more than 10 fully electric models by 2022.

Project One

Full-electric AMGs may be considered at some point. For now, the unit will test the waters with the GT 4-Door Coupe and the plug-in hybrid Project One, planned for 2021. That car will supplement a 1.6-liter V-6 engine with four electric motors, propelling it to 200 kilometers per hour (124 mph) in less than six seconds. Electric mode lasts for just 25 kilometers. For the C63 and other models, plans are still fluid.

While the global light-vehicle market forecast to shrink for a second straight year, according to Moody’s, prospects look more encouraging in the premium-car segment, where buyers are less price sensitive. Still, profit margins from plug-in hybrid and electric cars are still lower than for traditional vehicles.

Maintaining the price discipline to avoid steep discounts will be critical for Mercedes to protect returns.

“It’s very important that we ensure profitable growth, not only chase volume,” Seeger said.

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